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Yesterday, we announced over at Mystery Brewing Company that, as of September 1st, we’d no longer be offering refunds on growlers. Since this decision looks like it’s coming a little out of left field, and because I’ve always wanted this blog to be a little behind-the-scenes-ish for the brewing industry, I thought I’d take the time to lay out my reasoning behind why we’re doiing this.

Reason #1: Cleaning Growlers Sucks

It’s incredibly time-consuming and incredibly wasteful. To be fair, we don’t have a top-of-the-line growler cleaning machine, but that’s primarily because – as near as I can tell – one doesn’t exist. Here’s how we clean growlers right now:

Remove the growler from the box that it was returned in.

Remove and discard the cap, remove any stickers, price tags, or anything else that has been affixed to the growler.

If there are stubborn stains, put the growlers to soak in a hot caustic solution to remove those stubborn stains, flies, etc.

If there are cracks, chips, etc., immediately discard the growler.

After the caustic rinse and/or soak has been completed, each growler is rinsed with sanitizing solution to both neutralize the caustic and get it ready for fills. If you’re not filling as you’re cleaning, each growler is then re-boxed upside down to allow liquid to drain.

THEN when we fill them we re-inspect them (to make sure nothing’s happened inside, or someone hasn’t missed something earlier in the process).

Cleaning growlers is incredibly time consuming. Through 2013, cleaning growlers has been almost a full-time job at Mystery. It’s our estimate that we spend up to 30 hours of employee time every week cleaning growlers on an average week. If you count the amount of money that goes toward cleaning chemicals, water, caps, tape, and growlers that we just plain have to throw away because people are disgusting, on top of employee time, then every time we get a growler back from the marketplace that we need to clean, our profit on that original fill has been completely wiped out. If we were to get that same growler back again (which we have no good way of tracking), we would lose money. Losing money is not a good way to run a business. So the decision is partly an economic one.

Could we cut corners? Sure. But then our growlers would be gross. That’s also not a good way to run a business. Particularly one that relies on repeat purchases.

Reason #2: Growler Returns are a Logistical Nightmare

Getting growlers back from stores isn’t efficient or easy, either. Rather than just making a delivery to a store, you are now requiring a driver to go through the exercise of collecting and transporting empty bottles. Among the issues here:

Store employees often don’t sort growlers by brand, requiring a driver to go through box after box of empty growlers in order to make sure that they’re not paying a refund out for a growler that they’re not supposed to be picking up.

Since growlers often come back from consumers dirty, they often attract pests (normally thousands of fruit flies). Because of this, many stores keep growlers in locations away from everything else – at the bottom of a flight of stairs in the basement, locked in a storage shed outside the store, or even in multiple locations around the store.

Empty growlers rattle around in a truck much easier than full growlers. They’re much more likely to break when they’re empty because they don’t have mass keeping them in place.

The cardboard boxes that we use deteriorate as they go from warm to cold environments or dry to wet environments or any combination thereof. They break, they rip, the tape falls off, they have three or four different brands on them. Sometimes stores throw them out altogether and there is no good way to pick up empty growlers except for “loose.”

The crux of the issue here is that having a driver pick up empties adds a significant amount of time onto their route, and often adds an extra level of training and complexity, so it’s also inefficient and costly to the distributor.

Reason #3: Retail Growler Fills are now legal in NC

This summer, the North Carolina Legislature passed a law allowing retail growler fills in North Carolina (Session Law 2013-76). While the rules for this are not yet in place and it is not currently legal for retail establishments to fill growlers, it will be very soon. We anticipate that this will greatly reduce the amount of growler sales we make across the board.

Simply put: If a store can buy a keg from me and fill growlers with it, thereby making a much larger profit, why would they buy pre-filled growlers from me? Sure, some will, but many will not. Among the largest proponents of the retail growler law are Total Wine and Whole Foods, both of which have growler filling stations in other states, both of which are enormous potential customers for us when it comes to retail packaging. We’d rather sell them bottles than not sell them growlers. Or, better yet, sell them bottles and kegs so they can fill growlers themselves.

Reason #4: We’re Moving Into 22 oz. Bottles

And there it is: We’re moving into the bottle market. We’re interested in going into smaller packages that have a lower cost for us (growlers are crazy expensive), more portability, and lower cost in the marketplace. We’ve been told that in all cases in the local market, when a brewery has gone from offering growlers-only to growlers and bottles that their growler sales have dropped precipitously.

Reason #5: We Just Don’t Want To

We, the staff at the brewery, find growlers to be incredibly cumbersome and unpleasant.

Cleaning growlers is one of the grossest jobs we have. It’s full of old stale and rotten beer smells, mold, flies, and broken glass. We spend a lot of time with vinegary beer splashing on our clothes and ourselves, we spend hours wearing layers of protective gear as we clean them to keep chemicals off of us, or keep broken glass off of us. We spend hours scraping price tags and old stickers off of them. It’s just not nice. If we can make a more pleasant working environment while getting beer out to people in a better and more efficient way, we absolutely will.

In Summary

Growlers have been an important part of Mystery’s growth. In our first year, growlers made up a significant amount of our income. They have been an important part of getting our brand into the state and into the consciousness of state’s beer geek population, but we feel that with the combination of process problems inherent in growlers alongside the future of the marketplace (as we see it), that our time with them as a packaging option in bottle shops and grocery stores is coming to a close.

We’re excited to get smaller and better packaging out and we think everyone else will be excited to see it, too.

I’m a nerd. I’ve been to a lot of book signings and releases, and in each and every one of them the author generally gets up, reads a bit from the book, answers some questions, and then shmoozes and signs books for a while. I’ve also been to a couple of beer book signings and releases before where the author kind of stands around and drinks while signing books when people manage to approach the with a pen and a book in hand. I find the latter kinda lame. I want to hear from the author, that’s why I’m there. Otherwise I’m just drinking with somebody I don’t know and I could just buy a signed copy of the book and have the exact same effect.

So, this is where you come in – what do I do at these? The nature of this book is such that reading from it is difficult – it’s not fiction, it’s essentially episodic non-fiction. There are small snippets about the entire state and what’s interesting to a crowd in Wilmington will be different than what’s interesting to a crowd in Asheville. So, in order to make sure that everybody who goes to one of these gets a great experience, what’s the best thing to do?

I find myself roiling with thoughts and light rage, and so I’m doing what I always do in these situations: write.

Let’s set the stage to begin: New Belgium is working on opening an East Coast plant to cut down on shipping costs on their quest for country-wide domination distribution. There are lots of rumors about Asheville being on their short list of cities to open the plant in and, of course, New Belgium has neither confirmed nor denied these reports (to my meager knowledge).

I have really conflicting feelings about New Belgium. On one hand, they are some of the early pioneers in the craft industry and the industry as a whole has a lot to thank them for. They are leaders in brewing science and innovation. They produce high quality beer and are responsible for a whole LOT of craft beer lovers finding their way to industry in general. They are known as an excellent place to work and they have a strong commitment to being environmentally friendly and generally pretty awesome.

They also have some of the most invasive marketing and distribution tactics I’ve seen in craft. When New Belgium pushes into markets (as they recently did in North Carolina) with multi-million dollar marketing campaigns and sponsorship deals, small, local breweries cannot possibly hope to compete with them. Who sponsors the “local beer, local band” night around the corner from me? New Belgium. Who sells beer at the “Best of the Indy” parties? New Belgium. Who has been at every freakin’ local event before almost every local craft brewery? New Belgium. Why? Because in a morally dubious pay-to-play environment, they have the cash to pay – and pay a LOT – where small local breweries do not.

Is New Belgium the only brewery who does this? No. Good heavens, no. But in North Carolina, they were nowhere one day and everywhere the next, forcefully filling the niche I would have expected a lot of local breweries to fill. While most of that is their distribution partner, New Belgium also doesn’t seem to be in any sort of rush to stop those practices, either.

So, now maybe they’ll actually be a local brewery and that makes me a little sad and a little angry. They feel like a threat to our growing and thriving local beer industry, primarily because they have the ability and the apparent lack of scruples to muscle small business out of the way where they need to.

But that’s not what I really want to talk about. What I want to talk about is the ludicrous idea of offering them tax breaks to move in. The fact that it’s New Belgium makes no difference. My position would be the same for any large brewery moving in; however, the fact that it’s New Belgium in this case does feel a little like insult upon injury.

Tax breaks designed to entice big business is the kind of topic that drives me nuts regardless of industry, but in this specific case – and in MY industry – it seems even more ridiculous than usual. The idea, of course, is that Asheville would give tax breaks to New Belgium to entice them to open a brewery in the area, thereby creating jobs (and tax revenue).

Asheville, look around. You already have 9 breweries in you including the largest craft brewery in the state. Are you giving them tax breaks? Can you imagine how many jobs you could create by easing the tax burden on the businesses that are already there, already a part of your community, and already employing your local population? Instead of throwing money at a business coming in from another state (where most of that money will go), giving a large company with deep pockets even deeper pockets and an advantageous position over your local businesses, why not reward your local businesses for the excellent job that they’ve already done for you?

The local breweries in Asheville, along with its craft-beer-loving populace, have already brought country-wide attention and recognition to the area. Asheville has earned the moniker “Beer City USA” not because of its tax breaks, but because of its (stay with me here, this might get complex) beer. Why on earth would you, as a city council, make it easier to bring a small-business-crushing competitor to town? Sure, you might create jobs in the short term, but in the long run how is that one brewery opening going to effect the already existing breweries in your city and the already existing jobs? How many jobs could you create by reducing the tax burden on the businesses that already exist and thrive in your city, helping them open up new distribution channels, and grow enough to be able to stand up to the largest of breweries?

Tax breaks for incoming industries only make sense when you’re enticing an industry that doesn’t already exist into an area that economically depressed. Neither of these conditions seem true in Asheville.

Here’s the thing: If New Belgium is going to open a brewery in North Carolina, they’ll do it whether or not there’s a tax incentive thrown at them. They’re coming, and the best thing that we can possibly do is fortify our local industry so that we can welcome them as an equal level competitor, an enrichment of the local market. Giving them tax breaks that our local businesses do not enjoy is just inviting a fox into the hen house.